On Wednesday, shares of American Airlines Group Inc. rose after the company revised its second-quarter guidance, prompting Citi to upgrade its rating on the stock. American Airlines is an airline based in the United States
AAL,
3.27 percent increase
Shares increased over 7%, putting them among the top S&P 500 index performers.
SPX,
0.25 percent increase
performers in the middle of the day’s trading The stock was on track to close at its highest level in over two weeks, and it’s up nearly 36% this year, compared to around 17% for the S&P 500.
Delta Air Lines Inc. gave a boost to American Airlines and other airline companies.
DAL,
minus 1.51 percent
The airline’s first profit since the pandemic was reported in the second quarter. The U.S. Global Jets ETF is a mutual fund that invests in commercial jets in the United States.
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0.21 percent increase
It increased by approximately 1%. Citi analyst Stephen Trent wrote in a note Wednesday that American is expected to report a loss for the second quarter, and its long-term prospects “remain look fairly shaky.” “However, the combination of a stronger-than-expected 2Q operating guidance and shares slipping below our target price is difficult to disregard. As a result, Citi has upgraded the stock from a sell to a neutral rating,” he said. According to FactSet, analysts anticipate American to announce an adjusted quarterly loss of $2.21 per share on $7.3 billion in sales. In the year-ago quarter, the company reported an adjusted loss of $7.82 per share on sales of $1.6 billion, at the height of global travel restrictions and other impediments to air travel imposed to combat the spread of COVID-19. Summer travel is returning, but will it be enough to save the United States’ failing airlines? Analysts predict that the airline will publish earnings before the market opens on July 22. Late Tuesday, American provided an update on its quarterly results, indicating “a better quarter than the street had expected,” according to Citi’s Trent. Management predicted an adjusted per-share loss of $1.76 to $1.67, excluding special credits. Due to improved revenue and share sales, the business expects to end the quarter with $21.3 billion in liquidity, up more than $1 billion over earlier projections. However, Trent claims that operational improvements in the sector haven’t translated into greater stock performance. Inflationary labor costs and rising fuel prices continue to be issues for the airline industry. “Looking beyond the summer travel season, September appears to be a proving ground, as it should give us some insight into the demand recovery’s long-term strength,” he said./n
